Checklist: identifying a legitimate collection letter

 

 1. Does the account, the creditor or details of the account ring a bell

If not, please contact the collection agency to clarify the issue and avoid further costs.

 2. Do the details in the letterhead match the rest of the letter?

If not, exercise caution. If the bank details refer to a foreign country, this could be an indication of fraud. This may be identified by the first two characters of the IBAN (DE for Germany). Do not simply transfer money. Try to contact the company.

  3. What must the letter contain?

In the very first letter, the appointed collection agency must already give the reason for the receivable and details of the creditor's name or company.

 4. Do you still have doubts about the receivable?

Then enquire with the relevant collection agency. A legitimate company is always willing to explain the claim and answer any questions.

 5. How do I know that it is a legitimate company?

German collection agencies must be registered as such. You may visit www.rechtsdienstleisterregister.de to verify if the company is registered.Another sign of a legitimate company is membership at the Bundesverband Deutscher Inkasso-Unternehmen e.V [Federal Association of German Debt Collection Agencies]

 6. May collection costs be charged?

If a company appoints a collection service provider, this will incur collection costs. §§ 280, 286 of the German Civil Code (BGB) states that the debtor must compensate the creditor for damage caused due to default in payment. Collection costs are included in these damages caused by default.It should be noted that out-of-court collection costs in accordance with § 4 para. 5 of the Introductory Act to the Legal Services Act (RDGEG) are recoverable up to the remuneration amount due to a lawyer according to the provisions of the Lawyers' Remuneration Act (RVG), where the remuneration amount in the individual case is based on the total of the principal claim (the "value in dispute"). In this context, legislature established "tiers" of value in dispute in the List of Applicable Fees (Vergütungsverzeichnis or VV) of the Lawyers' Remuneration Act (RVG). Since 01.08.2013, the first tier covers values in dispute from 0.01 to 500.00 euros; the second tier is for values in dispute  from 500.01 to 1,000.00 euros, etc.